PayPal announced the PYUSD stablecoin last week. This was a very big move as it will allow the payment processor to practically compete with other stablecoin issuers like Circle and Tether. However, PayPal is one of the few traditional financial giants in the crypto space, and a very large one at that. Still, it’s a step back to the UK.
PayPal will stop using cryptocurrencies in the UK
CoinDesk writes this based on a statement from PayPal. The company is temporarily stopping offering cryptocurrencies to its customers in the UK as the Financial Conduct Authority (FCA) currently has stricter rules. Companies must “implement additional steps” before customers can buy cryptocurrencies. These are probably mandatory identity checks and checks to prevent money laundering.
Customers who have already purchased crypto through PayPal can simply keep their coins. You also reserve the option to sell. However, from October 1st, the ability to make new purchases will be disabled.
Unsurprisingly, the UK has become stricter on crypto companies, which now includes PayPal. Although the country wants to position itself as a “crypto hub” and thus establish favorable rules, strict identity controls and anti-money laundering measures are also strict requirements. Apparently, the measure will only be temporary. She wants to offer the option again in early 2024 once all the rules are fully complied with.
Earlier this year, UK banks even banned wire transfers to crypto exchanges. Still, the crypto industry was able to post another win earlier this summer. Crypto is not officially considered gambling in the UK, just an investment.
PayPal move big on crypto
Meanwhile, PayPal appears to have big plans for cryptocurrencies and blockchain. When the company announced stablecoin PayPal USD (PYUSD), it also updated its terms of service and revealed that it will effectively function as a full-fledged crypto exchange. However, analysts also expect the company to face serious competition despite being one of the largest companies in the industry.